Overview

Investment Objective

The Portfolio seeks to provide income and some capital appreciation.

Investment Strategy

The Portfolio invests in three Vanguard bond index funds, two Vanguard stock index funds and one Vanguard short-term reserves fund, resulting in an allocation of 62.5% of its assets to investment-grade bonds, 12.5% of its assets to stocks, and 25% of its assets to short-term investments. The percentages of the Portfolio’s assets allocated to each Underlying Fund are:

Vanguard® Total Bond Market II Index Fund 25.75%
Vanguard® Total International Bond Index Fund 18.75%
Vanguard Morningstar Institutional Total Stock Market Index Fund 7.50%
Vanguard® Total International Stock Index Fund 5%
Vanguard® Short-Term Inflation-Protected Securities Index Fund 18%
Colorado Short-Term Reserves Account 25%

Through its investment in Vanguard Total Bond Market II Index Fund, the Portfolio also indirectly invests in a broadly diversified collection of securities that, in the aggregate, approximates the Bloomberg U.S. Aggregate Float Adjusted Index in terms of key risk factors and other characteristics. The Fund employs an indexing investment approach designed to track the performance of the Index. The Index represents a wide spectrum of public, investment-grade, taxable, fixed income securities in the United States—including government, corporate, and international dollar-denominated bonds, as well as mortgage-backed and asset-backed securities—all with maturities of more than 1 year. The Fund invests by sampling the Index. The Fund seeks to maintain a dollar-weighted average maturity and an average duration consistent with that of the Index, which generally ranges between 5 and 10 years.

Through its investment in Vanguard Total International Bond Index Fund, the Portfolio also indirectly invests in government, government agency, corporate, and securitized non-U.S. investment-grade fixed income investments, all issued in currencies other than the U.S. dollar and with maturities of more than 1 year. The Fund employs an indexing investment approach designed to track the performance of the Bloomberg Global Aggregate ex-USD Float Adjusted RIC Capped Index (USD Hedged), which provides a broad-based measure of the global, investment-grade, fixed-rate debt markets. The Fund will attempt to hedge its foreign currency exposure, primarily through the use of foreign currency exchange forward contracts, in order to correlate to the returns of the Index, which is U.S. dollar hedged. Such hedging is intended to minimize the currency risk associated with investment in bonds denominated in currencies other than the U.S. dollar. The Fund maintains a dollar-weighted average maturity consistent with that of the Index, which generally ranges between 5 and 10 years. The Fund may become nondiversified, as defined under the Investment Company Act of 1940, solely as a result of an index rebalance or market movement. The Fund invests by sampling the Index, meaning that it holds a range of securities that, in the aggregate, approximates the full Index in terms of key risk factors and other characteristics.

Through its investment in Vanguard Institutional Total Stock Market Index Fund, the Portfolio indirectly invests in large-, mid-, small-, and micro-capitalization U.S. stocks. The Fund employs an indexing investment approach designed to track the performance of the Morningstar US Total Market Index, which represents approximately 100% of the investable U.S. stock market, and includes large-, mid-, small-, and micro-cap stocks regularly traded on the NYSE and Nasdaq. The Fund invests by sampling the Index, meaning that it holds a broadly diversified collection of securities that, in the aggregate, approximates the full Index in terms of key characteristics. These key characteristics include industry weightings and market capitalization, as well as certain financial measures such as price/earnings ratio and dividend yield. The Fund may become nondiversified, as defined under the Investment Company Act of 1940, solely as a result of an index rebalance or market movement.

Through its investment in Vanguard Total International Stock Index Fund, the Portfolio also indirectly invests in international stocks. The Fund employs an indexing investment approach designed to track the performance of the FTSE Global All Cap ex US Index, a float-adjusted, market-capitalization weighted index designed to measure equity market performance of companies located in developed and emerging markets, excluding the United States. As of October 31, 2024, the Index includes approximately 8,408 stocks of companies located in 47 markets. The Fund invests all, or substantially all, of its assets in the common stocks included in its target Index.

Through its investment in Vanguard Short-Term Inflation-Protected Securities Index Fund, the Portfolio indirectly invests in inflation-protected public obligations issued by the U.S. Treasury with remaining maturities of less than 5 years. The Fund employs an indexing investment approach designed to track the performance of the Bloomberg U.S. 0-5 Year Treasury Inflation-Protected Securities (TIPS) Index, which is market-capitalization weighted. The Fund attempts to replicate the Index by investing all, or substantially all, of its assets in the securities that make up the Index, holding each security in approximately the same proportion as its weighting in the Index. The Fund maintains a dollar-weighted average maturity consistent with that of the target index, which generally does not exceed 3 years.

Through its investment in Colorado Short-Term Reserves Account, the Portfolio indirectly invests in funding agreements issued by one or more insurance companies, synthetic investment contracts (SICs), and shares of Vanguard Federal Money Market Fund. Funding agreements and SICs are interest-bearing contracts that are structured to preserve principal and accumulate interest earnings over the life of the investment. Funding agreements generally pay interest at a fixed rate and have fixed maturity dates that normally range from 2 to 5 years. SICs pay a variable interest rate and have an average duration range between 2 and 5 years. Vanguard Federal Money Market Fund invests primarily in high-quality, short-term money market instruments issued by the U.S. government and its agencies and instrumentalities. For more information about Colorado Short-Term Reserves Account, please see the Interest Accumulation Portfolio profile.

Note: Colorado Short-Term Reserves Account’s investments in Vanguard Federal Money Market Fund are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although Vanguard Federal Money Market Fund seeks to preserve the value of the investment at $1 per share, it is possible that Colorado Short-Term Reserves Account may lose money by investing in the Fund. The Fund’s sponsor has no legal obligation to provide financial support to the Fund, and you should not expect that the sponsor will provide financial support to the Fund at any time, including during periods of market stress.

Investment Risks

Because it invests mainly in bond funds, the Portfolio is proportionately subject to interest rate risk, credit risk, income risk, call risk, prepayment risk, liquidity risk, and extension risk. Through its stock fund holdings, the Portfolio is subject to stock market risk. The Portfolio is also subject to country/regional risk, currency risk, emerging markets risk, special risks of investing in China, investment style risk, currency and currency hedging risk, income fluctuations, real interest rate risk, index-related risks, index replicating risk, index sampling risk, derivatives risk, nondiversification risk, sector risk, market risk, and event risk.

Average Annual Returns

**Consists of the Bloomberg Barclays U.S. Aggregate Float Adjusted Bond Index (61.25%), the Bloomberg Barclays Global Aggregate ex-USD Float Adjusted RIC Capped Index Hedged (26.25%), the Morningstar US Total Market Index (7.50%), the FTSE Global All Cap ex US Index (5%). The Bloomberg Barclays U.S. Aggregate Float Adjusted Bond Index replaced the Barclays U.S. Aggregate Bond Index on December 31, 2009. Effective September 29, 2016, Barclays indexes were rebranded to Bloomberg Barclays indexes. The Morningstar US Total Market Index replaced the MSCI US Broad Market Index (on January 15, 2013), which had replaced the Dow Jones Wilshire 5000 Index (on April 22, 2005). The FTSE Global All Cap ex US Index replaced the MSCI ACWI ex USA IMI Index (on June 3, 2013), which had replaced the MSCI EAFE + Emerging Markets Index (on December 16, 2010).

Annual Investment Returns

Historical Prices

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Fund ID: 1006041

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